Effect of leadership styles on entrepreneurship success: a comparative analysis

Leadership plays a pivotal role in shaping innovative capacity and entrepreneurial success. While leadership styles have been widely acknowledged as influential in dynamic socio-economic contexts, their transformative potential remains underexplored in developing economies. This study investigates how different leadership behaviours influence business innovation, development, and sustainability within region-specific entrepreneurship ecosystems. Guided by the Full Range Leadership Model, the study adopts a pragmatic mixed-methods approach, grounded in empirical data from diverse geopolitical zones. Results reveal significant relationships between leadership styles, entrepreneurial environments, and innovation outcomes. Transformational leadership is most effective in dynamic and rapidly evolving contexts (R = 0.747), fostering innovation and firm performance. Transactional leadership proves more suitable for competitive environments requiring structured performance incentives. Laissez-faire leadership demonstrates a moderate correlation (r = 0.476) in regions with lower entrepreneurial intensity. Notably, an entrepreneurial mindset enhances the explanatory power of leadership–outcome relationships (R2 = 0.568), underscoring the joint influence of internal leadership capacity and external context. It advocates for designing and implementing adaptive leadership development programs tailored to the socio-economic realities of distinct regions. Entrepreneurial innovation could thrive if leaders adapt their styles to unlock the transformative potential of entrepreneurship in developing economies.